Which of the following is not deductible as an Itemized Deduction if paid in the current...

Which of the following is not deductible as an Itemized Deduction if paid in the current year.

A: Personal Property Taxes

B: Real Estate Taxes

C: Special Assessment Taxes

D: State Withholding Taxes

Solutions

Expert Solution

Answer C: Special Assessment Taxes

Under United States tax law, itemized deductions are eligible expenses that individual taxpayers can claim on federal income tax returns and which decrease their taxable income, and is claimable in place of a standard deduction, if available. Itemized deductions are subtractions from a taxpayer’s Adjusted Gross Income (AGI) that reduce the amount of income that is taxed.

The government lets homeowners deduct the cost of state and local real estate taxes on federal income tax returns. According to the Internal Revenue Service, property taxes are deductible only if they are imposed uniformly on all properties in a jurisdiction and based on the assessed value of a property. Since Special Assessment Taxes only benefit properties in specific areas, they are usually not tax deductible. A special assessment tax is an amount you must pay above and beyond your normal property taxes to pay for special projects that benefit your neighborhood. The amount you pay for special assessment taxes may be based on the assessed value of your home.

ekkarill92 answered 1 year ago

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